Not just a little bit of chaos, either – the all-out, no-holds-barred kind!

That’s because in the tech sector, chaos equals profits. Major profits.

Chaos means that a technology or company is so brilliant… so disruptive… so unstoppable… that it completely shakes up entire markets and changes life as we know it.

And for the companies that create this kind of chaos, the bottom line is this: They become the unquestioned market leader. They set the trend. And they mint the profits. For themselves and investors.

But how do you identify these unique, life-changing companies?

My C.H.A.O.S. System will show you. If you need a refresher on how it works, go here.

But the premise is simple: Companies that score 85 or higher out of 100 on my ranking system win my official recommendation.

So without further ado, here’s the next company up to the plate…

The Most Important Company You’ve Never Heard Of

Founded in 1986, PLX Technology (PLXT) is a semiconductor company that designs, manufactures and sells integrated circuits – the fundamental building blocks for electronic equipment.

The company recently beat its quarterly earnings estimates and received analyst upgrades. But let’s not pop the champagne just yet.

Does it pass my C.H.A.O.S. System? Here are the results…

~ Cash

For a small-cap company ($282-million market cap), PLX Technology boasts a surprising amount of strength.

Let’s start with the company’s latest earnings report, which showed that for the year ending on December 31, 2013…

Year-over-year revenue rose by 4%, to $104.5 million.

Net income totaled $7.1 million, versus a loss of $5.2 million in 2012.

The earnings beat of $0.07 per share whipped consensus estimates of $0.02.

However, it’s important to note that while PLX enjoyed a strong overall 2013, its fourth-quarter revenue dropped by 5.3%, compared with Q4 2012. That hit the company’s EPS, which sunk by 16.7% during the quarter, compared with a year earlier.

Overall, half of PLX’s earnings reports have missed analysts’ consensus estimates over the past two years.

But I don’t care that much about analysts.

What I do care about is the fact that PLX outshines its peers in some key categories.

For example, its EPS growth rate eclipses 99% of its competitors. And it’s extremely liquid, too, with a quick ratio that beats 85% of its rivals.

What’s the quick ratio? Well, it basically measures a company’s short-term liquidity and its ability to “keep the lights on” by evaluating the amount of its liquid assets against liabilities.

When a company has a quick ratio of 1.0, its liquid assets to debt ratio is 1:1. Meaning, it has an equal amount of both. So the company can cover its debt, but won’t have any money left over.

But PLX’s increasing liquidity isn’t just a sign of the company’s improving cash flow. It’s also a sign of its dedication to shareholders. Over the last year, PLX shareholders have seen the net worth of their equity stakes rise by 20%.

On the downside, PLX does have a very lengthy cash conversion cycle, which can delay expected revenue. When you factor that into the cyclical nature of semiconductor industry, it explains why PLX can have erratic earnings results.

C.H.A.O.S. Meter: 15/20

~ High-Impact

New products can be cool. Some can be unique. Some are flat-out weird.

But regardless of their appeal, electronic gadgets would never make it to the shelves if it weren’t for the tiny components embedded inside.

If PLX can continue to notch earnings wins and analyst upgrades, these forces should combine to push shares higher. Particularly now that PLX’s earnings expectations have increased substantially through 2014 and 2015.

As if that weren’t enough, PLX has also received buyout attempts in the past. While they failed, the company remains a strong takeover candidate in the increasingly consolidating semiconductor industry.

C.H.A.O.S. Meter: 17/20

~ Orders

PLX sells approximately 120 products to a group of more than 1,000 blue-chip customers.

And it ships its platform technology to industry giants like Microsoft (MSFT) for its Windows High Performance Computing (HPC) servers, rack servers and blade servers. It also ships to IBM (IBM), Cisco (CSCO), Hewlett-Packard (HPQ), Oracle (ORCL), Intel (INTC), Dell, Fujitsu (FJTSY), NetApp (NTAP) and Fusion-io (FIO) – just to name a few!

The reason it has so many big names ringing its register is because PLX holds the biggest competitive advantage with its switches and bridges.

And because PLX was one of the first to market with its technology, it monopolizes more than 70% of the market share. It’s now considered the go-to company of its kind.

Although semiconductors are America’s second-largest export industry, its global market share has dwindled in recent years.

This does cause some concern. While PLX’s North American sales rose by 4%, its net revenue through distributors declined by 4%. Much more slippage here could impact the company’s performance and share price.

However, with cost-effective, energy-efficient, high-speed products, I don’t see PLX taking too much of a hit.

C.H.A.O.S. Meter: 15/20

~ Scalability

There are several areas where PLX can scale its business – and bottom line – higher. For example…

High-Density Datacenters: Today’s standards provide inadequate power consumption and costly ownership. But PLX’s technology is solving these problems. And as the need for data storage explodes over the next several years, demand for PLX’s technology will explode with it.

Convergence: In this context, convergence refers to the combination of two or more different technologies in a single device. This requires advanced technology that can deliver at high volume, fast speed and low cost.

Computing: High-performance computing is driving the usage of more solid-state drive (SSD) systems that demand high-bandwidth connection in order to work effectively. This market alone is doubling each year.

PLX offers comprehensive low-cost, high-performance semiconductor software and hardware solutions for all of the above.

However, it’s a highly competitive industry, and I expect that competition to intensify as PLX’s rivals expand their product offerings and new players enter the market.

The big advantage for PLX, however, is that it’s a well-established company whose technology is respected, trusted and very effective. So while PLX should continue to compete at the top end, it does face a few more obstacles.

C.H.A.O.S. Meter: 14/20

OVERALL C.H.A.O.S. RANKING: 79/100

Final Verdict: PLX’s technology is a fundamental building block in the architecture of many electronic devices. The company scores a high 79/100, due to its positive financials, competitive advantage and the huge growth potential from the expanding cloud market.

I believe these factors will have a greater impact than the firm’s weaknesses.

For investors, it offers a better risk/reward opportunity than many of its semiconductor peers. However, keep in mind that as a small-cap stock, its share price is prone to greater volatility. But with a beta under 1.0, the fluctuations shouldn’t be too dramatic.

Every time President Trump rails against the media, he adds millions in market capitalization to The New York Times Company (NYT). So buying a few call options on NYT is virtually certain to pay off. If you’ve never traded options, fear not. I asked my senior analyst, Martin Hutchinson, to describe options so that a kindergartener would understand.